Limited Company Set Up
Most people purchase Properties in the name of a Limited Company rather than their personal names to reduce taxation and lower risk. Many also believe that purchasing Property in a Limited Company name offers more flexibility when it comes to changing ownership of the Property.
Tax benefits
One of the most obvious tax benefits is the fact that Limited Companies are able to fully deduct mortgage interest as an allowable expense, whereas an investor who has purchased an Investment Property does not enjoy this same benefit. Furthermore, Limited Companies pay corporation tax on their profits from rental income whereas an individual pays income tax. A higher rate taxpayer could end up paying more money than a Limited Company
Risk benefits
Purchasing a Property in the name of a Limited Company allows you to protect your Property portfolio where you arrange the purchase of one property per Limited Company. This protection is not afforded to people who own multiple Properties in their personal names as their entire portfolio of Properties could be at risk if something goes wrong on one Property.
Ownership benefits
Finally, owning Properties in the name of a Limited company opens up the possibility of investing with friends, family and other investors. It also has the flexibility of determining ownership of the Property through shareholding which can be amended more flexibly. Furthermore, fees relating to the transfer of Property such as Stamp duty can be saved when selling the Limited Company rather than the Property itself.
Despite these benefits, it is highly important for you seek the advice of experts before purchasing a Property in the name of a Limited Company.
If you would like to know whether buying a Property in the name of a Limited Company is the right thing for you and/or you wish to set up a Limited Company for the purpose of buying a Property, we have expert Partners on hand that can take you through the entire process.
Our Partners are able to
-Design your tailor made buy to let company in just half an hour
-Handle Annual Accounts and Tax Filing for less than £30 per month
